AI to fuel smartphone sales rebound in 2017

Consumer purchases of smartphones dropped to a three-year low in 2016, but Accenture believes sales will rebound this year, fueled by demand for new capabilities including AI-driven digital assistants.

A new global Accenture survey finds that the expected resurgence will be also fueled by the introduction of better security, new functions, improved performance and device refresh schedules.

Accenture polled 26,000 consumers in 26 countries. Results show that more than half (54%) of consumers surveyed said they plan to buy a smartphone in the next year, up from 48% in last year’s survey.

Chinese consumers are the main drivers of this upturn, with three-quarters (74%) of respondents in China saying they intend to purchase a smartphone in the coming 12 months, up from less than two-thirds (61%) in last year’s survey.

The number of respondents in India and the United States who said they plan to buy a smartphone in the coming 12 months also increased by double digits over last year, to 79% in India (from 68% last year) and 52% in the United States (from 38% last year).

Among all consumers surveyed, the leading driver of purchase intent is the ability to access the newest and most innovative features and functions, cited by 51% of respondents in this year’s survey, compared with only 41% last year.

Another reason consumers are opting to buy new smartphones is the inadequate performance of their existing devices, cited by 45% of customers this year – up from 33% last year.

“Improved features and falling prices are key reasons consumers around the world are signaling a desire to buy new smartphones,” said David Sovie, global managing director for Accenture’s Electronics and High-Tech business.

“Growing acceptance of services powered by artificial intelligence, such as voice assistants, is also fueling this market upswing. 2017 will be the year when artificial intelligence goes mainstream in consumer devices.”

For the first time, the annual survey polled consumers about their intentions to buy digital voice-enabled assistants such as Amazon Echo and Google Home. Powered by artificial intelligence, the products recognize a human’s voice commands, such as ‘Turn on the light’ and ‘Play music’ and answer questions such as ‘What time is it?’ and ‘What is the temperature outside?’

While only 4% of the respondents said they own such a device today, two-thirds (65%) of these said they use their device on a regular basis, showing strong acceptance of this new technology.

Voice assistants on smartphones are also becoming increasingly popular as the AI technology powering these services has improved dramatically. Younger consumers are leading the adoption, with more than four in five (84%) of 14-to-17-year-olds saying they either use this technology today or are interested in doing so.

Consumers are also willing to embrace a wide array of potential AI-powered, personalized services, with a majority of respondents saying they are interested in personal health assistants (cited by 60%), smart trip assistants (59%) and entertainment advisors (51%).

Get the latest retail insights from Asia

just leave your details and we'll send it over